The Rise of Electric & Hybrid Vehicles in Kenya- Quick Guide

Kenya has seen a notable increase in the adoption of electric and hybrid vehicles. This growth is fueled by a desire to reduce fuel costs, which are notoriously volatile, and a growing environmental consciousness. In fact, a 108% increase in EV and HEV sales was observed during the 2022-2023 financial year, representing 8.3% of the new vehicle market. The number of EVs in Kenya surpassed 5,000 in 2024, a 41% surge from the previous year.

The economic advantages of these vehicles are a major draw. For one, EVs and HEVs are far more fuel-efficient than their gasoline-powered counterparts, a crucial factor for a country with rising fuel prices. An EV, for instance, can cost up to 60% less to run than a traditional car. Furthermore, maintenance is cheaper as there’s no need for frequent oil changes or spark plug replacements.

The Kenyan government has played a pivotal role in this transition. Key policies and incentives include:

A reduction in excise duty on electric vehicles from 20% to 10%.
An exemption of fully electric cars from Value Added Tax (VAT).
The introduction of green-colored license plates for EVs to promote their visibility and adoption.
Plans to establish 10,000 charging stations by 2030.

These measures are making green mobility more accessible to both individuals and businesses.

The Shift Towards Sustainable Car Rentals

For Kenya car rental companies, the rise of EVs and HEVs is not just a trend—it’s an opportunity for a sustainable business transformation. Integrating these vehicles into their fleets offers a distinct competitive advantage and aligns with global and national sustainability goals.

Opportunities 📈

Lower Operational Costs: The significant savings on fuel and maintenance can boost profitability and allow companies to offer more competitive rates, attracting a new customer segment.
Eco-Conscious Customers: As awareness of climate change grows, there’s a rising demand from both local and international tourists for eco-friendly travel options. A green fleet can be a powerful marketing tool.
Future-Proofing Business: With government policies increasingly favoring clean energy, investing in a sustainable fleet now prepares companies for a future where internal combustion engine (ICE) vehicles may be subject to higher taxes or restrictions.

Challenges 🚧

Despite the clear benefits, the transition isn’t without its hurdles.

High Upfront Costs: The initial purchase price of EVs and some HEVs is often higher than that of conventional cars. This can be a barrier for smaller rental businesses.
Charging Infrastructure: While the government has ambitious plans, the current charging network is still concentrated in major cities. This can lead to “range anxiety” for customers who wish to travel long distances, especially in rural areas.
Limited Skilled Mechanics: There is a shortage of qualified technicians outside urban centers who can service and repair the specialized systems of EVs and HEVs. This knowledge gap can lead to longer and more expensive repairs.
Battery Concerns: The cost of battery replacement, while a long-term expense (typically after 8-10 years), can be substantial and is a key concern for fleet managers.

The Road Ahead 🛣️

The transition to a sustainable car rental industry in Kenya requires a collaborative effort. The government must continue to expand the charging infrastructure and provide clear policies on battery recycling and disposal. Meanwhile, car rental companies can explore a hybrid approach, incorporating a mix of hybrid and fully electric cars to balance range and efficiency. Companies can also invest in staff training to build in-house technical expertise.

By embracing this shift, the Kenya car rental sector can not only contribute to a greener planet but also position itself as a modern, forward-thinking industry, ready to meet the demands of the future. The road to sustainable mobility in Kenya is a journey, not a destination, and the car rental industry is at a crucial crossroads.

Planning to explore Nairobi city and would love to rent an electric vehicle in Kenya with a driver or for self drive, simply contact us now by sending an email to info@rentadriverkenya.com or call us now on +256-700135510 to speak with the reservations team.